Scandals seen boosting Italy's anti-establishment party before vote

* Experts say scandals have benefited Grillo

* Italians fed up with graft

* Key regions still too close to call

By Steve Scherer

ROME, Feb 18 Comic Beppe Grillo's
anti-establishment 5-Star Movement appears to be stealing
momentum from Silvio Berlusconi after a string of scandals that
have hit the main political parties just before Italy's
election.

Publication of polls is illegal in the two weeks leading up
to the vote. But several electoral experts who have seen private
surveys told Reuters that Grillo's movement is the only one that
is thought to be gaining significantly since the blackout period
began.

The 5-Star Movement was at about 16 percent when the
blackout started, trailing behind the centre-left coalition led
by Pier Luigi Bersani on almost 35 percent and Berlusconi's
centre-right bloc on around 30 percent.

However, analysts say it is thought to have gained in the
past week, as a series of high-profile scandals has further
discredited the big parties. Berlusconi's potential voting pool
is the one where Grillo is gaining most, experts say.

This would stall the remarkable progress that Berlusconi has
made since storming back onto the political stage in December.

The progress made by Grillo's young movement of protester
and Internet activists as the Feb. 24-25 election date nears has
underlined his status as potentially the biggest wild card in
the race.

He has ruled out forming an alliance with any of the
mainstream parties but could play a decisive role in determining
the shape of the next parliament and whether a new government
enjoys a strong majority or not.

High profile scandals at Italy's third-largest bank Monte
dei Paschi, defence group Finmeccanica or
oil major Eni have highlighted close links between the
political and business elite and fuelled his maverick message.

The gains by Grillo's movement may favour the formation of a
stable government if they come at Berlusconi's expense and hand
the centre-left a clear victory. But they could also muddy the
result in the Senate, where the election law makes winning a
clear majority more difficult.

Under Italian electoral law, the coalition or party that
wins the biggest share of the vote gains an automatic majority
of some 54 percent in the lower house. The Senate is decided on
individual contests in the regions, which have varying numbers
of seats, based on their size.

STABLE

The gap between the two main coalitions contending for power
has stayed broadly stable, and outgoing Prime Minister Mario
Monti's centrist bloc is still in fourth place but sliding,
experts say.

Before the blackout period for polls, Berlusconi had made
races in the key regions that determine the Senate line-up too
close to call, notably the affluent northern region of Lombardy.
There is thought to be little change to this picture with less
than a week to go before the vote.

The 5-Star Movement's positive momentum is clear even
without knowing the trend of the polls. On Saturday, 30,000
turned out in Turin's central square on a frigid evening to hear
Grillo speak, several times as many as Berlusconi drew to an
indoor rally in Turin the next day.

That Berlusconi is aware of the Genoa comic's charge is
suggested by the increasingly hostile rhetoric the four-time
premier is using against the 5-Star Movement.

"We made an ugly discovery about Grillo's candidates,"
Berlusconi said on Sunday in Turin. "We discovered that 80
percent are members of the extreme left."

"There is a very high level of discontent and disgust in
Italy with the way the country has been run, and that is the
source of Grillo's popularity," said one analyst, who asked not
to be named.

Grillo founded his movement three years ago pledging to
sweep away the "dead" conventional political parties, which he
says are corrupt, inept and wasteful.

He has used corruption scandals in Lombardy and Lazio, the
region around Rome - which were both ruled by Berlusconi's
People of Freedom (PDL) party - in his stump speeches.

"The PDL says it will not put forward any candidates who are
under criminal investigation ... There won't be anyone left,"
Grillo growled from the stage during a rally south of Rome last
month.

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